The Illinois attorney general claims two student loan consolidation firms, First American Tax Defense and Broadsword Student Advantage, charge hundreds of dollars up front for products that don't exist or are available for free.

Lawsuits filed today by the Illinois attorney general accuse two student loan debt settlement firms, Broadsword Student Advantage and First American Tax Defense, of preying on borrowers desperate to reduce their student loan payments. The lawsuits are the first of their kind to go after debt settlement firms, which have surged in number since the recession.

Thousands of people deep in student loan debt come to these companies with the hopes of forgiving or lowering their debt.

It allegedly charges huge up-front fees.

First American Tax Defense charges anywhere from $700 to $1,199, and allegedly insists on receiving payments before they provide any services, as they did to one unemployed woman who said she had to pay First American $800 in installments before the company would work on her case. Broadsword charges $499 plus monthly fees of $49.99, according to the lawsuit.

First American also allegedly claims to be acting on behalf of the federal government.

The companies allegedly make promises they can't keep.

Because debt consolidation and forgiveness programs are determined by the Department of Education, First American Tax Defense's alleged promises to "cut loans payments in half" cannot usually be met, the lawsuit claims. First American also allegedly promised loan forgiveness to teachers and firefighters who were not eligible for the programs.

And Broadsword, for its part, allegedly misleads consumers into signing up for a $50 monthly "financial advisory" services.

One consumer said she was "surprised" to learn her $49.99 monthly payments were allegedly going to a sister company, Affordable Life Plans, for a financial planning service she had never signed up for. She only wanted her loans to be forgiven, she said. After paying a total of $898.60, the lawsuit says, she learned she was ineligible for the federal services she was promised by Broadsword.

Neither company explains that many programs could end up costing more in the long run, according to the lawsuit.

Income-based repayment and loan consolidation usually result in longer maturity periods, and thus more interest and higher overall cost. Broadsword and First American Tax Defense allegedly never informed consumers of this.